Obama To Freeze Government Salaries At All Time High

Tyler Durden's picture

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Oh regional Indian's picture

Yes Spalding, of the "small" variety. For most people that is.

What was that famous line from Animal Farm, about some animals being more equal than others.

I guess the definition of who is "others" is getting defined pretty quickly.

If you are in the "middle" class, anywhere, be ready to get crushed between the "Upper" and the flaming rage from the lower as the chasm widens. I say choose the "lower" side as a lifestyle choice. Guaranteed return on dis-investment.

 

ORI

http://aadivaahan.wordpress.com/2010/06/30/snake-eyes/ 

dkny's picture

Yes, we had change: we went from white to black.

Seriously, what more do you want?

66Sexy's picture

this is a deflationary indicator. the implication is that they have lost control of the dollar vs commodities trade and gold is performing positively in a deflationary speculative environment...

 

in other words, the shit is hitting the fan.

i.knoknot's picture

is it a deflation indicator?

it looks like the 'commodity' of federal employees is pushing into bubble territory and they're trying to cap that market with price controls... and you know what the historic result of price caps has been...

add to that how much we're all going to want more federal employees in the future, right? go long federal employees.

kind of like gold - but different.

:^)

Mercury's picture

This is no surprise at all to those of us who have been paying attention.

President Obama is a person who describes his entire three month experience in the private sector as "working behind enemy lines."   Dreams From My Father Ch.7 p. 55-56

flacon's picture

It is sickening to see these oligarchs pompously promoting statism.

Everything that the government provides, it must first confiscate from the private sector.

flacon's picture

 

Keep in mind that at age 22, Barry Baraq, the pot smokin' drop out looser was writing articles on interest-rate swaps. I kid you not! It's in his book:

 

"Then one day, as I sat down at my computer to write an article on interest-rate swaps, something unexpected happened. Auma called." ~ Dreams From My Father

 

You can google "dreams from my father pdf" and download it if you like. 

Here's the quote that Mercury was talking about:

"Eventually a consulting house to multinational corporations agreed to hire me as a research assistant. Like a spy behind enemy lines, I arrived every day at my mid-Manhattan office and sat at my computer terminal, checking the Reuters machine that blinked bright emerald messages from across the globe."  ~ Dreams From My Father

 

 

I just want to know how he goes from his bewilderment with his job ("blinked bright emerald messages from across the globe.") to writing articles about "interest-rate swaps". Did he even write this book?!

 

aerojet's picture

Doesn't seem like something Obama would pen, must have had a ghost writer.

chopper read's picture

obviously, this book was written by members of the international banking cartel as they sat on a yacht, smoking pot, and giggling their arses off about how the general public would buy it hook, line, and sinker.

MyKillK's picture

I thought he was a lawyer?? Why is he writing about economics?

It probably doesn't make sense because it's an invented past. We know almost nothing of the real Obama. The company he worked for in New York (Business International Corporation) is thought to be a CIA front company so my suspicion is that Obama has been a CIA agent since his early youth (both his mother and indonesian step father had many CIA connections as well)

Cognitive Dissonance's picture

Didn't we already prove wage and price freezes don't work just a few decades ago?

Dr. No's picture

Politics has always been different from reality.  Although tried and failed in the past, sufficient time and circumstances have changed to allow a politician to leverage the popular idea that freezing prices helps.  Next, expect trade restrictions.

Cognitive Dissonance's picture

Just another form of "This time it's different".

Unlawful Justice's picture

'Politics has always been different from reality'

They've got there own floor all to them selves.

A word I just found says it all. Dissimulation


Dissimulation is a form of deception in which one conceals the truth. It consists of concealing the truth, or in the case of half-truths, concealing parts of the truth, like inconvenient or secretinformation. Dissimulation techniques include: camouflage (blend into the background), disguise appearance (altering the model) and dazzle (obfuscate the model). Dissimulation differs fromsimulation, in which one exhibits false information. Dissimulation commonly takes the form of concealing one's ability in order to gain the element of surprise over an opponent.

[edit]Examples

Pool hustling might be seen as a form of dissimulation, because the hustler conceals their real talent. Yet it may also (or instead) be considered a form of simulation, because every pool hustle conveys false information about the hustler's abilities.

 http://en.wikipedia.org/wiki/Dissimulation

Zero Debt's picture

Didn't you get the memo? :)

Obama is implementing sticky wages a la Keynes.

"The Way Sticky Wages Should Be Done - Finger Lickin' Good"

 

SWRichmond's picture

The point is, this time they've been frozen to keep the Congress from lowering them.

i.knoknot's picture

ouch! good read on that one!!!

(watch the other hand)

Problem Is's picture

"Didn't we already prove wage and price freezes don't work just a few decades ago?"

That Means Its Time to Dust It Off and Trot It Out Again!!
The Amerikan Sheeple have long forgotten. Why not go Nixon?

Obummer is the most disingenuous, duplicitous MoFo since Tricky Dick "Peace With Honor in Vietnam" Nixon...

What's Obummer's Next Nixon Move? You Decide:

  1. [  ] Hire Kissinger
  2. [  ] Bomb Cambodia
  3. [  ] Spy on the DNC headquarters
  4. [  ] Take the US off of the Gold Standard

I can't wait for Obummer to take us off the gold standard again...

the not so mighty maximiza's picture

Federal Unions "Horray for me and fuck you"

Sircornflakes's picture

How about every Senator, POTUS & VP just forego their salaries for the next two years.....cut Federal salaries by 15%, freeze them there for five years and someone lead by example.

cosmictrainwreck's picture

AMEN, brother (sis?). The place I worked back in the 2008-09 panic - as shitty as it was - got a surprised "tip o' my hat" from me when they cut all us grunts 5%, but CEO took 25% and VP's 15%

solgundy's picture

Nah,,,don't worry about them...there's always the C.O.L.A. route.....more BS from BO....wait didn't he used to be BS???

John McCloy's picture

Freeze means they cannot go backwards either right??

Brilliant

mikla's picture

+1

That's *exactly* the purpose for this.

There will soon be announcements in *cuts* for Medicare/Medicaid, HUD assistence programs, Food Stamps, and even Social Security.  It will be part of the re-organization as Pensioners find out their checks will be getting (significantly) smaller too.

Good thing the Gubbermint workers are protected from such reality, including wholesale deflation in the *real* economy.

Miles Kendig's picture

Mikla, love your commentary.  So I gotta ask: What program is there that has allowed gubmit workers real estate holding to not only remain stable, but get the asserted mega boost?  Are they paid with a preferred currency, you know blue backs rather than green ones?

Meanwhile the ag, pharma, defense and many other subsidies, most especially TBTF continue to rocket past all of this.

Ragnarok's picture

Their D.C. real-estate will remain well bid, because of the 10s of thousands of bureaucrats this administration has and will hire.

Miles Kendig's picture

Actually, most of that is lawyers, lobbyists & defense/security contractors.  Next

To finish updating my previous post..

Meanwhile the ag, pharma, defense and many other subsidies, most especially TBTF continue to rocket past all of this manpower costing crap.  Still, the pain of deflation must be shared.  Looks like the major complaint is that gubmit workers pay has, more or less, done a better job of keeping pace with inflation over the past 20 years than the private sector. The aforementioned  (except FIRE workers of course) excluded. Does this mean that Obama should impose wage freezes on the elements of the private sector spared the pain of loss thus far? WOW, I never knew you were a supporter of wage controls Mikla ..  Are price and currency controls coming from ya next?  :D)

DaveyJones's picture

Miles have you seen the doc film "Food Matters?" Interesting look at Pharma / Nutrition / Health Care

Miles Kendig's picture

Yep.  Good ref DJ.  Hope you and yours had a nice break.  Best -

Ragnarok, the explosion of SES employees started in earnest back in 2001 when the previous administration took power and has continued unabated since.  Hence the quality statistics selected for this developing series.  You make it sound like the only place federal employees work is in DC..  ROFLMAO  Of course, in the case of the SES you'd be right.  However, those folks are only doing their two year enlistment of deprivation (and porn streaming) before returning to the private sector at Haliburton, Goldman, JPM or wherever and hardly represent the federal civil service ... The thrust of the article seems to indicate otherwise so I don't wonder at your apparent confusion

mikla's picture

Meanwhile the ag, pharma, defense and many other subsidies, most especially TBTF continue to rocket past all of this manpower costing crap.

We agree these "subsidies" should not exist.  However, they are growing because they merely represent bribes to coerce industries to re-align under new government efforts (e.g., Obamacare).  So, it is not surprising that with "greater government spending" the "winners" are the ones that receive government cash.

Still, the pain of deflation must be shared.

Good luck with that.  The government doesn't share like that.  Rather, the government merely picks "winners" and "losers".  Pension holders and those reliant upon public "largess" are the losers.  Government employees are the winners (it remains the only reliable political block).

Looks like the major complaint is that gubmit workers pay has, more or less, done a better job of keeping pace with inflation over the past 20 years than the private sector.

The complaint is that:

  1. the government pays above-market-labor-rates;
  2. "labor" as a cost within government is significant;
  3. these labor rates do not reflect forward liabilities (e.g., unfunded government pensions)
  4. government itself is mere overhead, and there is no cost pressure on government pay/expansion

Does this mean that Obama should impose wage freezes on the elements of the private sector spared the pain of loss thus far? WOW, I never knew you were a supporter of wage controls Mikla

I support market rates for wages (government should not be excepted as "special"), and support pressures to hold/decrease government as a percentage of the economy (because it merely represents overhead).

Miles Kendig's picture

Then I suggest you dig a little deeper.  You will be surprised, and disappointed if you're looking for confirmation bias at what you will find.  Just as the rest of the populace has been with greater appreciation of the "FIRE" economy so will the FIRE, and the general private economy gain a better appreciation by actually doing some homework.

Remember, federal pensions moved to a 401K style 20+ years ago (even though the two systems are lumped together as Bruce Krasting discovered recently) so don't confuse federal pensions with state/local, you should be smarter than to fall for that happy crappy.

Most federal salaries are actually below prevailing private sector wages, WG employees (blue collar, like HVAC & plumbers types) excluded since their wages reflect the prevailing local economy.  This especially holds true for the SES as it is well appreciated that  a partner at Goldman will not earn the same for going to treasury to look after the firms interests (that is until they return to the "private" sector) 

One reason there has been an explosion in physicians salaries is due to their chronic inability to keep pace in the past leading to "normalization".  In this I am happier that my VA doc hasn't had their license revoked in five or mare states (a common occurrence previously - thanks loads folks for suggesting we should go back to that).  In this I suppose talent does follow the money which is why so many folks here at ZH are public sector employees.  ROFLMAO  I have said it before and I will again, public service is for fools.  I should have devoted my professional life to investment banking instead.  My choice.  I know that after my son does his bit there will never be another member of my family that will ever consider public service again.  Trust that.  Public service is for dumb fucks too stupid to predate on everyone else.

mikla's picture

I don't care if all Federal employees make minimum wage, or less.

Rather, government spending, as a percent of the economy, is too high.  It represents mere "overhead" (and typically mal-investment).

There are no cost pressures to this overhead, and mal-investment.  Quite the contrary:  Government pandors to this political block in exchange for power, at the expense of the taxpayer.

Government wages is a significant portion of government expenditures, and cannot be excepted from necessary reduction.

 

Miles Kendig's picture

I don't care if all Federal employees make minimum wage, or less.

WOW.  A medial doctor or law enforcement pro making minimum wage.  Wage & price controls is the Mikla answer then.  Thanx for the clarity.

I will go back now for the right compensation package - Miles Kendig

Buckaroo Banzai's picture

What the hell are Doctors doing working for the Federal Government in the first place????? Only if they are serving military doctors, should they be drawing a federal salary-- and we have an officer's pay scale for them.

mikla's picture

I don't care if all Federal employees make minimum wage, or less.


WOW.  A medial doctor or law enforcement pro making minimum wage.

Context is important.  Please re-read my statement.

  1. Government employees do not deliver value for the price paid.  (Their individual paycheck is irrelevant.)
  2. Government employees, as a percentage of GDP, represent *far* too great a cost to society.  (They, as a group, cannot be protected against cutbacks.)

On the bright side, there will soon be a US Federal Government Default, and this whole discussion will be moot.

[EDIT] I have no problem with government employees making seven figures, if they deliver value.  Other government employees are overpaid at minimum wage.

RKDS's picture

Oh come on, this is just ridiculous.  I'm a non-union state employee in my 3rd year of pay freezes.  They're stealing my pension while welfare's getting raises and inflation is very real everywhere it counts.  And you think I should take a pay cut because the banks and outsourcers fucked up and want to lecture at me about free lunches?  Look, I get that the average taxpayer is broke, so am I, but it's not the fault of the rank and file worker (private or public) so why's everyone think it should come out of our hides alone?

Buckaroo Banzai's picture

Quit complaining and find a job in the private sector.

RKDS's picture

Fuck off you worthless bit-flipping day-trading statist whore.  May the free lunch you're busy stuffing down your gullet be your last.

Miles Kendig's picture

Cut the contractors and make private business meet its own needs and the federal budget would shrink >20% overnight.  The savings would be even greater at the local level.

Bendromeda Strain's picture

Thank you. Lots of heat with the minimal light shed here. I will grant the 1-3% pay raises that seem to fall like manna yearly, but the overwhelming majority of Fed workers (both Appropriated and Non) get rather mundane salaries once you get away from DC. Why do these articles and posts almost always fail to link a simple GS schedule? Wage Grade has to be competed against proven "prevailing wage" in each locality. Yes, Executive salaries have exploded, but the rank and file can't generally eat the kind of hit that needs to be taken to unwind the recent lunacy. Contractors have been screwing the Government since, well, Government, so "privatization" needs to come without subsidies of any kind to offset the pension savings.

http://www.opm.gov/oca/10tables/index.asp

Miles Kendig's picture

Just think, the linear analytical reasoning of this article and the part of the debate it represents does a marvelous job of mirroring the general appreciation within the public sector, and the general private sector, for what happens within the "FIRE" economy as well.  If anything, this just demonstrates the dimensions of the chasm that needs to be bridged.

Meanwhile, we can tell how happy folks are by what it is they're bitching about.  In this instance the dynamics of "what's in it for me" in a deflationary economy continue to assert.  No small wonder that the last to feel the pain will be where the wealth is concentrated.  One dollar, one vote continues to be the norm regardless of the best efforts at propaganda from the ruling elites.  A major reason there has been an explosion of SES employees and their "performance" bonuses.  Gotta pass out the grub to keep the nasties under wraps, serve the masters and stay in power.

functionform's picture

Cut the contractors?  Good luck.  Every conservative that whines about government spending and big government and free market will come out of the woodwork to defend "necessary and essential" programs that cannot be underfunded at this "critical time in American history".

Miles Kendig's picture

Remember, it's "liberal" too.  Just ask Russ Feingold the soon to be former senator from Wisconsin, Feinstein of California and so many more.  Fact remains that there is no real conservative presence in the halls of power just as there is no real progressive presence.  It's all gerbervores

flattrader's picture

Miles wrote--

>>>Cut the contractors and make private business meet its own needs and the federal budget would shrink >20% overnight.<<<

The profits to KBR, their subsidiaries and other contractors with two open checkbook wars have been mind boggling.

Since US invaded Trashcanistan, we spent nine years and more than $7 billion building and training the Afghan police force.  And this is what we got--

>>>"Who are the police? They are illiterate villagers, many of them users of drugs who come in, they have a six-week training course. Now, how can you teach somebody to read and write, to be a policeman, to defend themselves in six weeks? It just isn't possible. So what emerges is not a policeman, but someone who is marginally more effective at extorting money from his fellow citizens,"<<<

 

>>>Before Caldwell arrived, much of the actual police training was overseen by civilian contractors working for the U.S. State Department. But according to a government audit, there was no "measurement of contractor performance," nor was any "specific…type of training . . . required."

Nevertheless, of the $7 billion the U.S. has spent training the police, over one billion went to pay the contractors.<<<

http://www.cbsnews.com/video/watch/?id=7096993n

Miles Kendig's picture

Hell, there are contractors in the DC area pumping the defense/intelligence apparatus for far more than a measly 7bn a year per contract and they'll never face an audit.  Too intrusive.  I'm sure those folks would settle for minimum wage as Mikla and others suggest.  ROFLMAO  Hence the reason I will most likely look to this trough for my next boost.  With my KSA&E I should be able to land 10m a year with a guaranteed bonus + per diem, housing, transportation, personal security, related expenses and stock options, minimum.  Commercial air travel is sooo yesterday!

I will go back now for the right compensation package - Miles Kendig

flattrader's picture

Miles wrote--

>>>Cut the contractors and make private business meet its own needs and the federal budget would shrink >20% overnight.<<<

The profits to KBR, their subsidiaries and other contractors with two open checkbook wars have been mind boggling.

Since US invaded Trashcanistan, we spent nine years and more than $7 billion building and training the Afghan police force.  And this is what we got--

>>>"Who are the police? They are illiterate villagers, many of them users of drugs who come in, they have a six-week training course. Now, how can you teach somebody to read and write, to be a policeman, to defend themselves in six weeks? It just isn't possible. So what emerges is not a policeman, but someone who is marginally more effective at extorting money from his fellow citizens,"<<<

 

>>>Before Caldwell arrived, much of the actual police training was overseen by civilian contractors working for the U.S. State Department. But according to a government audit, there was no "measurement of contractor performance," nor was any "specific…type of training . . . required."

Nevertheless, of the $7 billion the U.S. has spent training the police, over one billion went to pay the contractors.<<<

http://www.cbsnews.com/video/watch/?id=7096993n